Buying a home or purchasing a new car is a major accomplishment. Paying off your mortgage or debt as early as possible will be the best investment you can make.
A survey indicated that 68 percent of recent homeowners felt there was a strong chance they could pay off their mortgage or debt earlier than their current amortization schedule.
The freedom that being completely debt-free brings is a dream for many Canadians, so take the time to do some calculations and figure out what options are right for you.
Pay your mortgage or debt every two weeks for a total of 26 payments each year, without paying your mortgage or debt monthly 12 times per year.
Start a debt ‘snowball’ plan
Make a list of your all debts. Start with the smallest balance and end with the highest. Make the minimum payments on all your debts. But make an extra payment on the one with the smallest balance.
When that debt is paid off, divert the payment you were making on it to the next debt on the list. By the time you get to the second and third debts. You’ll be making important payments to the principal, which is the only way to eliminate debt.
Start a debt ‘stacking’ plan
Make a list of your debts, starting with the one that has the highest interest rate. Make the minimum payments on all your debts. But make an extra payment on the one with the highest interest rate.
When that first debt is paid off, divert the payment you were making on it to the next debt on the list.
Round up mortgage or debt payments
Every dollar counts when it comes to paying off your mortgage or debt. The quicker you can pay off your loan, the more you will save in interest. By round up, your mortgage payments will make your mortgage disappear faster.
Once you have a mortgage or debt and start making your payments, it can be just forgotten because it’s an automatic payment.
To be an informed homeowner, you need to keep up to date on interest rates and new mortgage or debt options. You could potentially save a ton of money just by understanding what your options are.
Change your debt structure
If you want to free from debt, get rid of the retail credit cards since they have burdensome interest rates compared to those from major lenders. Two credit cards should be enough. You’ll pay less in annual fees.
Want to save some money? read our article about Simple Tips to Save Your Money.